By Printing Money Central Banks Have Already Begun the Next Stage of Warfare

Since the Financial Crisis erupted in 2007, the US Federal Reserve has engaged in dozens of interventions/ bailouts to try and prop up the financial system. Now, I realize that everyone knows the Fed is “printing money.” However, when you look at the list of bailouts/ money pumps it’s absolutely staggering how much money the Fed has thrown around.

The Fed is not the only one. Collectively, the world’s Central Banks have pumped over $10 trillion into the financial system since 2007. This money printing has resulted in a massive expansion of Central Bank balance sheets, spread inflation into the system, and done nothing to address the key solvency issues that lead up to the great crisis.

This competitive debasement has lead to increased tension between the world’s Central Banks. You will never hear their stated outright for the simple reason that the single most important responsibility of the Central Banks is to maintain confidence in the system.

However, underneath the veneer of goodwill and the occasional necessary coordinated intervention, tensions are rising between Central Banks. When the US debases the US Dollar it pushes the Euro higher. This hurts German exports which in turn angers the Bundesbank.

The Bundesbank fired a warning shot at the Fed last autumn when it announced it wanted to have its Gold reserves at the Fed audited. To be clear here: no one of major financial import has ever questioned the Fed’s trustworthiness before. However, at the time of this announcement Germany stated it had no intentions of actually moving its reserves.

Fast-forward to today and Germany has not only audited and checked its Gold reserves at the Fed but it is now moving them. In plain terms, Germany has told the world that A) it does not trust the Fed and B) it is through playing around.

This situation will likely be getting worse going forward. The fact that Germany will be removing all of its Gold reserves from France certainly doesn’t bode well for future German French relations if push ever comes to shove (it’s not as though Europe has a history of getting along well).

Look for increased tension to grow between the world’s Central Banks in the coming months and years. This tension will likely result in:

Economic warfare (see the recent situation in Iran)

Political infighting

Key players being sacrificed

Given that the financial system and economic “recovery” have been built on a house of cards, these political developments will have major impacts on the financial markets.

Outside of internal dissent, the power players in the global economy (the US, China, Japan, and Germany) are showing increasing signs of tension both internal (China and the US) as well as external (China vs. Japan, Germany vs. the US, the US vs. China).

These tensions will lead to economic warfare and very likely physical warfare in the coming years.

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Preparing Your Portfolio For Obama’s Economic Nightmare

How to Protect Yourself From Inflation

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Bullion 101: Everything You Need to Know About Investing in Gold and Silver Bullion…